PCI DSS (Payment Card Industry Data Security Standard) compliance is a set of security standards with which organizations who handle payment card data must comply. The purpose of these standards is to ensure that sensitive information like credit card numbers and personal data are protected from unauthorized access and theft.
The latest update to PCI DSS Standards, version 4.0, was released March 2022 by the PCI Security Standards Council (PCI DSS 4.0). This most recent version of the standard took four years to create and grew from 139 pages for PCI v3.2.1 to 360 pages for PCI v4.0. 64 additional requirements are present, 13 of which take effect in March 2024, when PCI DSS v3.2.1 is formally decommissioned. The remaining 54 requirements are “best practices” until March 2025. That doesn’t mean you can sit back and enjoy your current compliance status for the next 2 years. On the contrary, 2023 must be used as a transition period to assess the new standard and modernize your security controls. There is a lot of work to do and very little time. Do not assume because you are PCI 3.2.1 compliant that you will be PCI 4.0 compliant.
Failing to Comply
Failing to comply with these standards results in serious consequences for businesses. In this article, we detail the consequences of failing PCI DSS compliance and the steps businesses can take to avoid it.
Penalties and Fines
The most immediate consequence of failing PCI DSS compliance is the possibility of penalties and fines. The payment card industry takes data security very seriously, and non-compliance can result in significant fines that can range from thousands to millions of dollars, depending on the severity of the breach. These fines are usually imposed by the payment card brands, such as Visa, Mastercard, and American Express. Failure to pay these fines can make it difficult or impossible to process credit card transactions.
Legal Liability
Failure to comply with the PCI DSS increases an organization’s legal liability in the event of a data breach and the offender may be held liable for the resulting damages and costs. This can include the cost of notifying affected customers, offering credit monitoring services, and paying legal fees. Furthermore, noncompliance increases the likelihood of regulatory investigations, which can result in additional fines, penalties, and legal fees.
The Catastrophic Cost of Non-Compliance
Achieving and maintaining PCI DSS compliance is an added cost for businesses, but failure to comply can result in catastrophically higher costs. Fines, penalties, legal fees, and the cost of implementing new security measures to address vulnerabilities can all be incurred as a result of noncompliance. Furthermore, noncompliance raises the cost of doing business through lost revenue, reputational damage, and decreased customer loyalty.
Reputation Damage
A data breach can have serious consequences for an organization’s reputation. Consumers rely on businesses to safeguard their sensitive information, and failing to do so leads to a loss of trust and confidence. This lack of trust means decreased consumer loyalty, income, and damaged brand reputation. Even without a breach, the perception of a lack of security is damaging to a company’s brand.
Loss of Customers
Consumers have a choice about where they do business, and a breach impacts trust in an organization’s capacity to protect their sensitive information. This leads to a drop in consumer loyalty and a loss of revenue. It can take years to rebuild trust and confidence – devastating for most businesses.
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